Cargo Volume Forecast Looks ‘Encouraging’, Says APM Terminals Pipavav
APM Terminals Pipavav has seen a less than 10 percent drop in volumes so far in April, says Jakob Sorensen.
Even as the new coronavirus pandemic disrupted logistics at Indian ports, APM Terminals Pipavav said cargo volumes forecast looked “encouraging”.
“While we are seeing cancellations of shipping lines, at the same time we are also seeing opportunities in terms of surge in exports of agricultural products. So the net effect is less pragmatic,” Jakob Friis Sorensen, managing director at the port operator, told BloombergQuint in an interview. The company, he said, has seen a less than 10 percent drop in volumes so far in April, “which is amazing”.
The company is still seeing cargo coming in by ship and has very effective rail operations going on, Sorensen said. The transit time is less than 48 hours now from Gujarat to Delhi, where the company has one of its largest clients, he said.
This comes at a time cargo handled by Indian ports fell the most in five months in March as the novel virus outbreak stalled economic activities and India went into a three-week lockdown, which is now extended through May 3. Though Indian ports are exempted from the lockdown, many workers are grappling with transport problems and have left for their hometowns.
APM Terminals Pipavav, however, expects some impact on realisations. “A lot of customers are asking to waive charges and postpone billing. So we have tough calls to make.”
While extended lockdown is going to be a big challenge, Sorensen said there might be chances that the company can use its capacity to fit into the global supply chain. “We have capacity in our yards for storage and even if there is demand crunch, we could still accommodate export orders,” he said.
APM Terminals Pipavav is also not ruling out a possibility of incurring capital expenditure. “I would not say we have put a stop to capital expenditure at the moment. We are still trying to see the opportunities,” he said. “If we have an opportunity now, then I don’t think we have seen anything more interesting than right now.”
Watch the full interaction here: